Government of Timor-Leste

The Council of Ministers approved, at the meeting on July 7^th 2021, a draft Decree-Law for the creation of extraordinary assistance for the integration into the labour market for beneficiaries of “cash for work” programmes, presented by the Minister of Finance, Rui Augusto Gomes.

The “cash for work” programmes were created to help the clean-up and reconstruction efforts, after the flooding, last April, using local labour, while providing a source of income for thousands of unemployed workers.

To ensure that those programmes can have a longer lasting impact, the insertion of these workers into the labour market is promoted, encouraging their employment through financial support to companies and workers.

The extraordinary support created by this diploma are similar to those created by the Supplementary Budget for the majority of workers and which did not include participants in “cash for work”.

The extraordinary assistance created by this legislation is similar to that created by the Supplementary Budget for workers in general, and which did not include the participants of "cash for work" programmes.

The three types of assistance created by this legislation are:

• The extraordinary labour market integration allowance is granted to employers who enter into a contract valid for at least six months with a participant in " cash for work". The amount of the allowance is equal to 70% of the employee's salary;
• Partial exemption from the duty to pay social security contributions, by the company and by the employee; and
• Extraordinary unemployment allowance, with a value of 40% of the value of the contractual remuneration relative to the 1st level that constitutes the basis of the contribution to social security upon optional membership.

The assistance will be implemented by the National Social Security Institute in coordination with SEFOPE and will be financed by the COVID-19 Fund.